Analysts are changing their price target predictions for Apple in response to …

Although Apple shares have gone down in the past few days, the growth of the stock in the past year has been quite impressive. Analysts have been setting price targets, then quickly raising them as they make new predictions. One item that's been giving analysts trouble is how to predict the stock price from Apple now that it is getting revenue over time from the iPhone. According to Bloomberg, analysts have taken to using cash flow rather than earnings to create their price targets and better account for the iPhone.

Because of the way Apple defers the monthly cut it gets from AT&T for each iPhone subscriber, the revenues won't show up in the earnings for 24 months. They will show up in the cash flow that Apple receives over the course of a quarter, though. Using multiples of cash flow and predicted profits per share, analysts have set price targets ranging from a reasonable $210 to a whopping $600 (made by the first predictor that Apple would reach $200).

In general, analysts are banking on the iPhone as well as momentum from the recent iMac, iPod, and Leopard launches to make those price targets come true for Apple. More new product launches in the spring and perhaps including a new MacBook and a 3G iPhone could continue the momentum. Another iPhone price drop would certainly attract a few more buyers too, so the optimism seems realistic. I guess we'll see in a few months, but I wouldn't sell your Apple stock just yet.